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Old 08-24-2017, 11:57 PM
 
6,353 posts, read 5,168,799 times
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Quote:
Originally Posted by dcfas View Post
According to the article:

The personal finance site [GoBankingRates] compared average expenses for people age 65 and older, including groceries, housing, utilities, transportation and health care in every state to come up with how long a nest egg of $1 million would really last.

Funny how they don't mention taxes.
I think they are talking about the spend-down of a $1 million savings account on which income taxes have already been paid.
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Old 08-25-2017, 02:44 AM
 
71,779 posts, read 71,875,234 times
Reputation: 49345
Quote:
Originally Posted by FREE866 View Post
What is the growth assumption of the million? is it just straight line zero growth?
seems like how the money is invested will have big impact
not only is it zero growth but it assumes zero inflation too . the most important factor is sequence risk when spending down . so even if they weed growth out inflation ain't zero and it is certainly not the same year after year . negative real returns because of inflation creates sequence risk so their math is really bogus .

the sequence inflation struck is what caused 1965/1966 to be the greatest failure period for spending down from assets .

here is reality . no matter where you live , , how long that money lasts can vary by as much as 15 years over a 30 year period just based on the order your market returns , interest rates and inflation come in ,even though the averages appear the same . sequence determines how long money lasts not a reverse amortization calculator using the same averages year after year .

since the country consists of 1500 mini economies different parts have different inflation rates at different times . nyc has not had rent increases in 2 years for millions of people because more than 1/2 of all rentals are stabilized . they may actually have lower costs at times then supposedly cheaper areas with higher rent increases since rents are one of the biggest costs we have .

got to rate this another useless dopey article , other than telling us where you live matters . duh!!!!!!

you got to love these ill-informed people who write these articles and have zero financial knowledge about what they write.

Last edited by mathjak107; 08-25-2017 at 03:12 AM..
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Old 08-25-2017, 03:25 AM
 
71,779 posts, read 71,875,234 times
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Quote:
Originally Posted by Hemlock140 View Post
The other problem is that it assumes the same cost throughout the state. Here in WA for example, the Seattle area median priced home is over $600,000, but go two hours in any direction and you can find something for under $200k, even under $100,000. My property tax is $6,500/year, my parents about 2.5 hours away are paying less than $500.
just my point above . inflation and costs vary greatly ,even in state . is that author trying to tell us living in scarsdale ny in westchester is the same high costs as living in east new york brooklyn ?

i will bet some live cheaper in east ny or brownsville brooklyn than in some of the better areas in the so called cheap states .

anytime you attempt to paint with a broad brush , simple answers to complex questions will be the wrong answers
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Old 08-25-2017, 10:35 AM
 
Location: Forests of Maine
30,695 posts, read 49,488,800 times
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This OP is looking at if you had $1Million and just spent it down to nothing?

On my pension it would take me 56 years to have received a million dollars.

If I first subtracted how much I spent to buy our home, it would still take 53 years for me to go through a million dollars.

But what if that million were invested, earning a return and you only spent the interest?
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